HUMANITARIAN FRAUD? / TAX FRAUD

HUMANITARIAN FRAUD? I include a question mark because the accusation is not yet conclusive. However, Steve Kroft on the CBS investigative reporting program 60 Minutes has presented preliminary evidence indicating that philanthropist Greg Mortenson may have gone over to the dark side. Mortenson, the author of Three Cups of Tea and Stones Into Schools, is co-founder of the Central Asia Institute, a non-profit organization "whose mission is to promote and provide community-based education and literacy programs, especially for girls, in remote regions of Pakistan and Afghanistan." Mortenson's books and lecture tours have inspired millions of people with his message of hope.

But, according to 60 Minutes, "last fall we began investigating complaints from former donors, board members, staffers, and charity watchdogs about Mortenson and the way he is running his non-profit organization. And we found there are serious questions about how millions of dollars are spent, whether Mortenson is personally benefitting, and whether some of the most dramatic and inspiring stories in his books are even true."

Mortenson and the CAI are based in Bozeman, Montana. Among the allegations against him are that he lied about his adventures in central Asia, that he lied about the number of schools which he claims to have founded, and that much more CAI funding is being spent on promoting Mortenson's book tours than is spent on actually building and maintaining schools. The CAI does not receive any profits from the sale of Mortenson's books. Only he does.

Perhaps the most disturbing and potentially damning aspect of the investigation is that Mortenson is stonewalling. He refuses to be interviewed, refuses to allow independent audits of his or the CAI's finances, and behaves in an antagonistic manner to legitimate questions about his finances and the Institute's operation. Mortenson is perhaps the most effective proponent for humanitarian aid of our generation. He has performed immense good among the poorer peoples of Pakistan and Afghanistan. Yet he appears to have fallen victim to his own charismatic image, as well as to the lure of a life of ease and riches.

Here is a link to both the transcript from the 60 Minutes segment, including the video of the segment. I truly do not want to believe the allegations against Mortenson, but the preliminary evidence is compelling, and he refuses to come clean. Check out the program and see what you think.

TAX FRAUD. Senator Bernie Sanders is emerging as a forcefully vocal advocate of social justice. In the realm of taxes and fiscal responsibility, he has assembled a list of the ten most egregious corporate freeloaders -- giant companies which pay few or no taxes, and which receive subsidies, refunds, and bailouts from American taxpayers. We're talking billions and billions of dollars, here. In an era when Republican wingnuts are seeking to punish those who aren't wealthy by cutting social services, and reward those who are wealthy by excusing them from pulling their fair share of the financial burden of running a nation. this imbalance is nothing short of hideous. The ten corporations listed are --

~ Exxon Mobil

~ Bank of America

~ General Electric

~ Chevron ~ Boeing

~ Valero Energy

~ Goldman Sachs

~ Citigroup

~ Conoco Phillips

~ Carnival Cruise Lines

Speaking of the current hysteria among deficit hawks over cutting funding to social programs, it is useful to place things in perspective -- the U.S. ranks dead last in overall social spending among the 34 member nations of the Organization for Economic Cooperation and Development (OECD). Dead last. Currently "the U.S. spends only 7.2 % of our gross domestic product on programs that make up our social contract with the American people. Compare that to 21 % for Germany, 21.3 % for Greece, and 26 % for Canada. Especially instructive is this chart which compares the U.S. and Germany in criteria such as child poverty, infant mortality, homicide rate, life expectancy, unemployment, exports, and industrial growth.

So what is to be done? Clearly a massive overhaul of the U.S. tax system, including elimination of exemptions and loopholes for the wealthy and for corporations, is only the first step. Annie Lowrey at Slate has a somewhat radical solution -- radical in that it is so simple, no one else had thought of it. Her suggestion? Do nothing. Drawing upon projections from the Congressional Budget Office, and setting aside the polarized budget debate, she proposes that the national budget deficit has been wildly overstated, according to the CBO's own figures.

Thus "doing nothing allows all kinds of fiscal changes that politicians generally abhor to take effect automatically. First, doing nothing means that the Bush tax cuts would expire, as scheduled, at the end of next year. That would cause a moderately progressive tax hike, and one that hits most families, including the middle class. The top marginal rate would rise from 35 to 39.6 percent, and some tax benefits from investment income would disappear. Additionally, a patch to keep the alternative minimum income tax from hitting 20 million or so American families would end. Second, the Patient Protection and Affordable Care Act, Obama's health care law, would proceed without getting repealed or defunded. The CBO believes that the plan would bend health care's cost downward, wrestling the rate of health care inflation back toward the general rate of inflation. Third, doing nothing would mean that Medicare starts paying doctors low, low rates. Congress would not pass any more of the regular "doc fixes" that keep reimbursements high. Nothing else happens. Almost magically, everything evens out.

" .... by and large, the hard work of fixing the fat part of the budget has already happened, through health care reform. The Social Security crisis you sometimes hear about is essentially a myth .... The big wheels of deficit reduction are already turning, and it might be better for Congress to step back, stick to pay-as-you-go, and let them turn."

You'll want to click on the "radical solution" link above for more details on the proposal. On many levels, it makes sense. The problem lies in shaking up the status quo, gutting the system in which politician's pockets are lined with large donations from vested interests, and requiring our representatives to do what they were elected to do .... represent us.